Depending on the industry, up to 50% of America’s workforce will be eligible for retirement in the next five years. That is a staggering statistic with widespread implications. From financial services to aerospace to the public sector, aging boomers will be leaving a huge leadership gap.
Who fills that gap is of utmost importance to an organization’s future success. With so many people leaving the workforce, it’s no longer acceptable to have a casual process for promoting employees to management. Given the gravity of this looming leadership exodus, organizations need to plan and implement strategic programs to train potential managers.
The attractiveness of these development programs is likely to become a competitive issue. With organizations battling for the best talent, high-potential employees are in an enviable position. They have choices—something they haven’t seen since the 2008 crash.
The importance of a strong first-level management team cannot be overemphasized. Ask any organizational expert and they will tell you the most important and toughest job in most organizations belongs to first-line managers. They not only touch more people than other members of the leadership team, they are directly responsible for making sure the organization’s strategy is executed. Add to that, their responsibility for employee engagement and customer satisfaction, and the impact they have on the bottom line is nontrivial.
Three essential strategies for developing leaders ‘ success:
1. Hire Smart
Not so long ago, the strategy for promoting people to management focused on rewarding the strongest performer in a department. That may have worked when organizations followed a Theory X style of management, however, it is a failed strategy in most work cultures today. Instead, companies need to find people who want to be managers because they want to help develop others.
From a talent management perspective, this means hiring people who are both qualified for the job they are applying for and who also exhibit the attributes that your company is looking for in leadership. Does the person express ambitions for growth? Do they want to take leadership skills training courses to strengthen their leadership skills? If your organization has multiple locations, is that person willing to relocate? These leadership attributes need to be included in the hiring equation.
2. Focus on Your High-Potential Employees
With the demand for high-potential employees increasing as the boomers retire, organizations need to create programs that will build loyalty. One of the best ways to do that is to create a special leadership track for high-potential employees. If your organization currently does not have a specific program for High Potential Employees, benchmark with organizations in your industry that do. While every organization’s program is slightly different, some similarities include a rotation assignment program to help the employees understand various aspects of the company. Not only do the employees work in different functional areas during this assignment, but it’s not unusual to have them rotate to various geographical locations as well. Often a rotation will include assignments in communication, finance, information technology, manufacturing, operations, sales and marketing. These programs are a Win – Win for both the organization and the employee.
3. Provide a formalized Leadership Program
Far too many organizations make the assumption that their managers automatically know how to create an environment that results in employee engagement, loyalty and motivation. Research shows that most people in management positions need training to develop these “soft skills.” By helping employees can gain better insights into their own emotional and cultural intelligence, as well as learning strategies for engaging employees, building trust, and providing value added feedback, they will become more productive and their overall job performance will increase.
Conclusion
In conclusion, the impending retirement of a significant portion of America’s workforce presents both challenges and opportunities for organizations. By implementing strategic leadership development programs, companies can address the looming leadership gap and secure their future success. The three essential strategies outlined – hiring smart, focusing on high-potential employees, and providing formalized leadership programs – are crucial steps in this process.
As we face this unprecedented shift in the workforce, organizations that prioritize leadership development will not only weather the transition but will also gain a competitive edge in attracting and retaining top talent. By investing in the next generation of leaders, companies can ensure continuity, drive innovation, and maintain their competitive position in an ever-changing business landscape.
Remember, developing strong leaders is not just about filling positions; it’s about shaping the future of your organization. By taking proactive steps now, you can build a robust leadership pipeline that will drive your company’s success for years to come.